India's struggling Kingfisher Airlines said late Saturday its services would return to normal after a strike by employees over long overdue pay forced cancellation of more than three dozen flights.

The announcement came after the airline's owner Vijay Mallya told workers in an open letter that "damaging the future of Kingfisher in the public's eyes is not going to produce cash" to pay wages and keep the carrier aloft.

The walkout, the third in under two weeks, came after the airline -- which owes vast sums to banks, suppliers and staff -- won more time from lenders this month to come up with a recovery plan to avert bankruptcy.

The strike made efforts to revive the airline "more difficult by causing concern and apprehension among potential investors", said the tycoon, who also heads the profitable United Breweries (UB) Group.

Kingfisher said in a statement it was "pleased to announce that all its scheduled flights will be operating normally" but did not elaborate further.

Forty domestic flights were cancelled during the one-day stoppage, airline vice-president Prakash Mirpuri told AFP, but declined to disclose the number of workers who took part in the walkout.

They stayed home "due to salary payments not being credited to the bank accounts of all employees", Mirpuri said.

He said 75 percent of employees had received their back wages -- outstanding since February -- by Friday and the rest would have them by Monday.

"If some of you think cancelling flights, speaking to media, or disgracing our company will produce cash and salaries, you are wrong," Mallya, known as the "King of Good Times" for his opulent lifestyle, told employees.

The workers replied there could not be a "bigger disgrace to the company than defaulting on payments to global aircraft leasing companies, airport operators, oil marketing firms, government taxes apart from the salaries".

Kingfisher, which has $1.4 billion in debts, is flying some 15 aircraft, down from an earlier 64 planes, as it battles to curb costs.

It has halted international operations and has the smallest market share among Indian airlines at 5.4 percent after being the second-largest carrier.

In May, the airline reported quarterly losses tripled to 11.52 billion rupees ($210 million) from a year earlier.

Mallya has been lobbying hard to push the government to allow foreign carriers to buy stakes in domestic airlines.

Foreign direct investment in aviation is seen as a potential lifeline for airlines such as Kingfisher, named after Mallya's flagship beer label.

Almost every carrier is posting losses even as the number of passengers grows 20 percent annually with the sector hit by high fuel costs, fierce competition and shabby airport infrastructure.

The problems of Kingfisher are reckoned to be the worst among the private carriers, partly due to overly rapid expansion, while the government is reviving debt-laden state-run Air India with a nearly $6 billion bailout.

"I am doing my best," Mallya, whose other group companies sell about half of all alcohol consumed in India, told employees. "I personally have devoted more time to our airline than to any other UB Group company."